Europe is potentially quite conservative when assessing the significance of blockchain according to recent survey of over 1,500 European business decision makers across the banking and financial services, manufacturing, retail, healthcare and insurance industries.
Cognizant’s report, ‘Blockchain in Europe: Closing the Strategy Gap’ highlights the fact that while there are a number of breakthrough ideas on how blockchain could solve some of today’s most pressing problems, there are still challenges when it comes to turning those ideas into reality.
Reluctance to collaborate with other businesses means that it could take even longer for blockchain to become mainstream. The survey shows that the vast majority of European firms intend to develop their own modelling techniques with only two per cent planning to join a consortium of startups and competitors.
The case for blockchain
Blockchain is seen by most European businesses as a strategic imperative with 83 per cent of respondents expecting it to have an important or very important impact on their industry even if they are not yet sure how. Although for most European businesses, blockchain is being used as a new way of completing existing tasks as opposed to innovating.
Almost half of respondents (49%) said the blockchain would add to current operating models without drastically changing them.
Cognizant’s report stresses that European businesses will need to explore new ways of working to truly realise the potential of blockchain. Rather than focusing on improving internal business processes in the traditional way, companies should try to envision scenarios of how blockchain adoption of multiple parties can help address systemic problems across industries in the long term.
Internal barriers holding back Europe
The majority of those surveyed (70%) consider competitive advantage to be a top benefit of blockchain with business opportunities including addressing process inefficiencies (94%) or even the creation of new service lines (62%). However, the research reveals several internal barriers stopping it from becoming impactful including truly understanding use cases and assessing their costs and benefits (51%).
Blockchain Consulting Practice Lead at Cognizant, Lata Varghese offered further insight on the findings of the report, saying:
“In a very short time, blockchain has grown from a technology with narrow applications related to payments and cryptocurrencies, to one meriting attention from many business leaders. The challenge for business across Europe is that blockchain does not fit into current operating models. New operating models for whole industries need to be designed. Further, many implementation challenges remain including scalability of the technology and integration with current enterprise applications.
“This way of working will mean that the full potential of blockchain may not be realised quickly enough across the region. Blockchain needs to be approached as an open, collaborative and disruptive power that can be used for institutional innovation, not merely as a way for conducting business as usual.
“A focus on collaboration with other players to benefit wider industry will be key to realising the real potential of blockchain.”